To think a lot of people make poor spending choices and then blame everything else?

[ThatTidySnake]

A lot of people are making very poor choices about what they spend their money on, and then it becomes everyone else’s problem or fault when they end up in an overdraft, with credit card debt or unable to afford things like repairs, food or presents. I get that not everyone is in the same position and circumstances matter, but it does sometimes feel like personal responsibility gets overlooked.

AIBU?

I agree.

It might have been saved over 20/30 years. It might have been an inheritance. It might have been savings from during a previous period of employment. From during a marriage before it ended. It might have been sitting there for years and not have been added to in a very long time.

Yep.

It's highly unlikely someone is claiming UC with £0 in savings and are suddenly managing a 7k kitty just because they are now on UC. It's usually due to previous circumstances before UC.

Maybe but many would argue that you should use your quite considerable savings to support yourself before you come to the state. It's about personal responsibility and paying your way, otherwise everyone irrespective of savings would turn to the state and say that they can't use the £100k they have saved as they might need it in the future for something else.

About 18 years ago, I bought a 25% share in a shared ownership property with a £5,000 deposit. After living there for around 5 years, I considered selling to try and buy a fully owned home. When I mentioned it to a friend, she was keen to buy my share because the deposit requirement was relatively low.

However, after getting the property valued, I realised selling wouldn’t leave me in a strong enough financial position to move on, so I decided to stay. My friend was very upset and accused me of 'letting her down' because she was 'struggling to save a deposit'.

She had always lived rent-free with her parents, earned more than I did, and had accumulated significant credit card debt. It seemed she was blaming me for her own inability to get onto the property ladder.

But what about assets? Why is it just about savings? What about people who own their own house, or their car, or a caravan, or a valuable antique/painting, etc? Should they sell up before going onto UC? I think a relatively modest amount of savings is entirely acceptable.

Think things have always been thus.

Some people are bad with money and spend it all and want handouts. Lots of people are sensible and don't. I mean there's literally bible stories about this so it's not a new phenomenon.

But the thing is when the economy changes there are many sensible people who get burned. My family for example with cost of living increases and mortgage increases and VAT on school fees (yes our choice to privately educate but still, the cost went up) whilst wages have stayed same means we've had less and less to save each month. And some unexpected things mean we've had to spend our savings. So now if one of us were made redundant (possible, both our companies are doing badly due to market factors) we'd be royally screwed.

I would say we did all the right things. Or mostly, I mean we could have lived like monks all along and not bought a house or educated privately or ever gone on holiday to save more but really where's the fun in that. I had relatives who lived that way, never went anywhere or had any fun, saved every penny, then died. Why?

I have a friend who is in debt by a scary amount (several tens of thousands). Both her and her DH have an issue with spending, but they do not blame anyone or anything else at all. In fact, they are embarrassed by it and admit it is their own fault.

I remember that one too. Which would mean that the second someone is paid their UC, then they will suddenly be ineligible for it. I think some people did not realise that everything is regarded as capital, including your own UC and wages.

In my case? Financial prudence, allied with luck.

Never having new clothes. Always cooking from scratch (and being vegetarian). Never having a credit card. Looking for the cheapest deals on everything. Telling the DC we can't afford this, that and the other. I am constantly astounded by how much people on MN spend on stuff.

But there's also an element of luck. Social housing, so no top ups over the LHA rate. Very low energy prices compared to most people (we have a heat pump, thanks to the housing association. Plus, a small house costs less to run).

I worked hard to build up a "just in case" safety net. Something that we are all supposed to be doing....unless you're on benefits, when you're penalised for being careful and thrifty 🙄

But surely the principle is a person should have exhausted their own resources before turning to the state. It kind of doesn't matter if that person had been saving that money for a rainy day / house / holiday / new pair of shoes... if it's there, tough luck, use that to meet your outgoings before you start claiming.

Because having people on the bones of their arse, lurching from one financial crisis to another, is going to cost the state more in the long run.

Just as an example....if I don't have a reliable vehicle, I can't work. Which means that I claim more benefits. Etc etc.

Not having decent, healthy meals and a warm home will give people- especially children- health problems. Which will end up costing the NHS more. Etc etc

That is already the case, and that amount is set at £16k. If you have that amount, you can not claim UC.
If you have more than £6k, then you get less in UC. You also have to show that you are not buying anything out of the ordinary to reduce your capital so you can claim/get more UC.

Savings are liquid and often easy to access quickly. There are very obvious and practical reasons why they can act as an immediate financial safety net in a way that housing for example can't. Why is it better to use other people's money as a safety net when you have your own?

I also think there is an ethical question about allowing people to save money and potentially buy large assets with money that they have claimed through benefits. It wouldn't feel fair to many taxpayers and would compound the already controversial issue that many families on benefits are better off than working families. At the moment, for right or wrong, people need to come off benefits to buy the big assets that most people want. This is an incentive to become financially self sufficient and it would undoubtedly be weakened if you were allowed to save more money whilst on benefits.

My friend and her husband are like this, but I don't think they're accountable at all... They remortgaged their house to go to Disney World and pay for new carpets then were upset when their mortgage was up for renewal and they had a hike of £300 per month due to the interest rates. It all seemed a bit bonkers to me!

I mean - who remortgages to get new carpets when most major carpet shops offer 0% interest....

You are allowed up to £16k in savings. Most people on benefits don't work and a large amount of those that do work won't need to buy a van or expensive asset to work.

They will also have access to a warm home and healthy meals without needing over £16k in the bank. The average person in the UK under 55 years of age doesn't have that much in savings but you can't say that they are all on the 'bones of their arse' or unable to provide warm homes for their kids. It's the norm not to have over £16k in savings.

It also acts as a disincentive though. Look at pensions. Lots of people make the conscious decision not to save into a pension because they know that any private pension they receive will reduce the amount of pension credits. Those living on very low incomes or benefits are basically being held back by the benefits system, where they "could" work more, save more, etc., but can't actually see the benefit if their benefits (short and long term) will be reduced accordingly. Likewise with the savings limit - it may stop them from being able to start their own business if they can't save enough to pay for the upfront costs, marketing, equipment, etc. No easy answer, but as a country, we have to start thinking outside the box re both the tax and benefits systems as they're both holding back economic growth at the moment.

As for people saying we shouldn't be letting people "save" when they're on benefits or UC, isn't that back to poor spending choices when "some" people manage to save on low wages/benefits/uc but others can't - are we saying those who can't are "wasting" some of their money, as presumably their incomes (wages and benefits) are the same as those who are managing to save?

Honestly, people make poor choices about many things in life and blame everyone else. There is a distinct lack of accountability that runs throughout the generations and it's concerning. The same generation then has the audacity to disparage younger generations about their thoughts and behaviours. Where do they think this younger generation picked these things up from?

I know people that go on multiple expensive holidays a year and constantly moan about lack of money. Also buying their lunch each day from M&S etc I haven’t been on a holiday in years so it’s a bit annoying having to listen to that when there are obvious cut backs they could do.

I think the idea that everyone that's on benefits wants or even could save to fund financially gainful businesses is really odd. This will be a very small percentage of people on benefits. Most don't work. Those that do work are more likely to work PT and in low paid occupations. Most small businesses fail. Arguably it isn't a great idea for someone reliant on benefits and with savings that they can't easily rebuild to invest a large amount of savings in setting up a business. They would be better off seeking PAYE employment which is far less risky.

I think the point is that benefits are there as a safety net and meant to cover essentials. If you are saving thousands of pounds then clearly there is some excess in there and it's an argument to reduce benefits rather than increase saving thresholds so savvy benefit claimants can squirrel away tens of thousands of taxpayer's money.

Just to add, to use an analogy when I was younger I would get lunch money from my mum for school. I soon worked out that I could buy a bag of chips and drink and save a pound a day that I could save and buy clothes etc with. My mum found out and went mad. She instantly reduced my lunch money allowance. She didn't praise me for being savvy as she claimed I had ascertained the money under false pretences that I needed it for lunch (an essential) when in fact I wasn't using it for lunch at all. I think this is similar to benefits. It's there to fund the essentials and meet people's basic needs. It isn't some flexible income stream that you can be smart with to improve your personal financial situation at the expense of everyone else.

Sounds familiar.

DH's ex lives in rented and was complaining how skint she was after the landlord put her rent up. She also said she could no longer afford to go halves on DSC's uniform (they live with us 70/30). But she also bought herself a Rolex for her birthday so...

I don't know, I think it would differ from person to person. Lots of people really don't have enough money to make ends meet at the moment even if they are really careful while there are others who overspend on things they can't afford. I don't think it's a thing I can make a blanket judgement on.

I just think that people who manage to save out of their benefits shouldn't be penalised when those who waste all of their benefits and can't be arsed to save or control their spending, don't get penalised.

Benefits are too high if you can afford to save them. That's the reality. We have a welfare bill that's out of control. If you have £16k you have more than the average amount of savings if you are under 55. This has to be enough otherwise we are suggesting that the majority of people need a government top-up to boost their savings higher than this. It makes no sense. Who is paying for it?

If someone on benefits can budget well and manage to save a bit, then there is nothing wrong with that. Benefit claimants do not have a say in how much they get and should not have that amount reduced because that have not spent it.
There is more to life essentials than housing, bills and food. If someone on benefits needs a new fridge, then they should be allowed to save up... and thankfully the system allows that. It makes no sense to remove anything they have not spent, or reduce their benefits.

That is a curious stance to take given the topic of this thread. Spending unwisely = bad. Saving on benefits = bad.